general assessment: Ukraine´s telecommunication development plan, running through 2005, emphasizes improving domestic trunk lines, international connections, and the mobile cellular system

domestic: at independence in December 1991, Ukraine inherited a telephone system that was antiquated, inefficient, and in disrepair; more than 3.5 million applications for telephones could not be satisfied; telephone density is rising slowly and the domestic trunk system is being improved; the mobile cellular telephone system is expanding at a high rate

international: country code - 380; two new domestic trunk lines are a part of the fiber-optic Trans-Asia-Europe (TAE) system and three Ukrainian links have been installed in the fiber-optic Trans-European Lines (TEL) project that connects 18 countries; additional international service is provided by the Italy-Turkey-Ukraine-Russia (ITUR) fiber-optic submarine cable and by earth stations in the Intelsat, Inmarsat, and Intersputnik satellite systems

temperate continental; Mediterranean only on the southern Crimean coast; precipitation disproportionately distributed, highest in west and north, lesser in east and southeast; winters vary from cool along the Black Sea to cold farther inland; summers are warm across the greater part of the country, hot in the south

Terrain:

most of Ukraine consists of fertile plains (steppes) and plateaus, mountains being found only in the west (the Carpathians), and in the Crimean Peninsula in the extreme south

note: administrative divisions have the same names as their administrative centers (exceptions have the administrative center name following in parentheses)

Independence:

24 August 1991 (from the Soviet Union)

National holiday:

Independence Day, 24 August (1991); 22 January (1918), the day Ukraine first declared its independence (from Soviet Russia) and the day the short-lived Western and Central Ukrainian republics united (1919), is now celebrated as Unity Day

cabinet: Cabinet of Ministers selected by the prime minister; the only exceptions are the foreign and defense ministers, who are chosen by the president

note: there is also a National Security and Defense Council or NSDC originally created in 1992 as the National Security Council; the NSDC staff is tasked with developing national security policy on domestic and international matters and advising the president; a Presidential Secretariat helps draft presidential edicts and provides policy support to the president

elections: president elected by popular vote for a five-year term (eligible for a second term); note - a special repeat runoff presidential election between Viktor YUSHCHENKO and Viktor YANUKOVYCH took place on 26 December 2004 after the earlier 21 November 2004 contest - won by Mr. YANUKOVYCH - was invalidated by the Ukrainian Supreme Court because of widespread and significant violations; under constitutional reforms that went into effect 1 January 2006, the majority in parliament takes the lead in naming the prime minister

After Russia, the Ukrainian republic was far and away the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR. Ukraine depends on imports of energy, especially natural gas, to meet some 85% of its annual energy requirements. Shortly after independence was ratified in December 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Loose monetary policies pushed inflation to hyperinflationary levels in late 1993. Ukraine´s dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. A dispute with Russia over pricing led to a temporary gas cut-off; Ukraine concluded a deal with Russia in January 2006, which almost doubled the price Ukraine pays for Russian gas, and could cost the Ukrainian economy $1.4-2.2 billion and cause GDP growth to fall 3-4%. Ukrainian government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine´s large shadow economy, but more improvements are needed, including fighting corruption, developing capital markets, and improving the legislative framework for businesses. Reforms in the more politically sensitive areas of structural reform and land privatization are still lagging. Outside institutions - particularly the IMF - have encouraged Ukraine to quicken the pace and scope of reforms. GDP growth was 2.4% in 2005, down from 12.4% in 2004. The current account surplus reached $2.2 billion in 2005. The privatization of the Kryvoryzhstal steelworks in late 2005 produced $4.8 billion in windfall revenue for the government. Some of the proceeds were used to finance the budget deficit, some to recapitalize two state banks, some to retire public debt, and the rest may be used to finance future deficits.

GDP (purchasing power parity):

$329.1 billion (2005 est.)

GDP (official exchange rate):

$75.14 billion (2005 est.)

GDP - real growth rate:

2.6% (2005 est.)

GDP - per capita (PPP):

$7,000 (2005 est.)

GDP - composition by sector:

agriculture: 18.7%

industry: 45.2%

services: 36.1% (2005 est.)

Labor force:

22.67 million (2005 est.)

Labor force - by occupation:

agriculture: 24%

industry: 32%

services: 44% (1996)

Unemployment rate:

3.1% officially registered; large number of unregistered or underemployed workers; the International Labor Organization calculates that Ukraine´s real unemployment level is around 9-10% (2005 est.)

18-25 years of age for compulsory and voluntary military service; conscript service obligation - 18 months for Army and Air Force, 24 months for Navy (2004)

Manpower available for military service:

males age 18-49: 11,020,222

females age 18-49: 11,370,687 (2005 est.)

Manpower fit for military service:

males age 18-49: 7,376,050

females age 18-49: 9,313,385 (2005 est.)

Manpower reaching military service age annually:

males age 18-49: 382,751

females age 18-49: 365,599 (2005 est.)

Military expenditures - dollar figure:

$617.9 million (FY02)

Military expenditures - percent of GDP:

1.4% (FY02)

Information about transnational issues

Disputes - international:

1997 boundary treaty with Belarus remains un-ratified due to unresolved financial claims, stalling demarcation and reducing border security; delimitation of land boundary with Russia is complete and parties have renewed discussions on demarcation; the dispute over the maritime boundary between Russia and Ukraine through the Kerch Strait and Sea of Azov remains unresolved despite a December 2003 framework agreement and ongoing expert-level discussions; Moldova and Ukraine have established joint customs posts to monitor transit through Moldova´s break-away Transnistria Region, which remains under OSCE supervision; in 2004 Ukraine and Romania took their dispute over Ukrainian-administered Zmiyinyy (Snake) Island and Black Sea maritime boundary to the ICJ for adjudication; Romania opposes Ukraine´s reopening of a navigation canal from the Danube border through Ukraine to the Black Sea

Illicit drugs:

limited cultivation of cannabis and opium poppy, mostly for CIS consumption; some synthetic drug production for export to the West; limited government eradication program; used as transshipment point for opiates and other illicit drugs from Africa, Latin America, and Turkey to Europe and Russia; Ukraine has improved anti-money-laundering controls, resulting in its removal from the Financial Action Task Force´s (FATF´s) Noncooperative Countries and Territories List in February 2004; Ukraine´s anti-money-laundering regime continues to be monitored by FATF